On March 15, 2004, Judge Richard Owen of the U.S. District Court for the Southern District of New York reinstated a preliminary injunction against software manufacturer 321 Studios (“321”). The March 3 injunction, which had been temporarily stayed by Judge Owen, bars 321 from manufacturing, selling, or promoting its DVD-copying software. The company is also barred from moving its assets without court approval. Paramount Pictures and Twentieth Century Fox had requested injunctive relief from the court, contending that 321, by selling software capable of circumventing DVD copy controls, was guilty of violating the anti-trafficking provisions of the Digital Millennium Copyright Act (“DMCA”), 17 U.S.C. § 1201. 321 claimed that its software did not violate the act because it was not “primarily designed or produced for the purpose of circumventing CSS” and had legitimate fair use purposes. The court rejected these arguments as well as 321’s constitutional challenges to the DMCA, citing Universal City Studios, Inc. v. Reimerdes, 82 F.Supp.2d 211 (S.D.N.Y. 2000); Universal City Studios, Inc. v. Reimerdes, 111 F.Supp.2d 294 (S.D.N.Y. 2000); and Universal City Studios, Inc. v. Corley, 273 F.3d 429 (2d Cir. 2001).
321 filed a Motion of Appeal from the Order on March 19, 2004, and has requested a stay of the injunction pending appeal. The Motion states that as a result of the injunction the company has been forced to lay off employees and that without a stay its “chances of survival are slim.”
321 is also currently fighting a second injunction ordered in similar litigation in the U.S. District Court for the Northern District of California on February 20, 2004.
